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Restructuring

Restructuring and turning around a business or organization is often required when the performance is not meeting expectations and/or, in extreme cases, diminishing cash flow has jeopardized its very survivability. Restructuring is often required after an acquisition or merger in order to integrate the business into the new parent organization by harmonizing the policies, procedures, practices, processes and systems.

In these situations, resistance to changeĀ is to be expected because it is often associated with downsizing and layoffs. Change that is poorly implemented can have negative consequences and become toxic to the organization.

Leaders must understand the stress factors that cause resistance, and develop a Plan to overcome the resistance and gain employee support and trust. Resistance to change is quite normal, and to be expected.

These stress factors include:

  • Fear of the unknown
  • Reluctance to move out of a comfort zone
  • Failure to see the advantages and benefits of changing
  • Fear of new responsibilities and risk of losing status

The planning process included in the Business Planning Guide discusses these issues. The very fact of going through the planning process is very effective in dealing with the resistance because it includes a discussion of the reasons for change and the need for improvement. In some cases, the planning process can be as beneficial as the Plan itself.